DSSI's DSI and Optimus S.A. Have Teamed to Deliver Command Assistance Systems for the Polish Police.

WARSAW, Poland/TEL AVIV, Israel--(BUSINESS WIRE)--Sept. 30, 1999--

Optimus (Nowy Sacz), a Polish affiliate of Lockheed Martin, and DSI, a wholly owned subsidiary of Data Systems & Software Inc. (Nasdaq: DSSI), announced today that they have formed a strategic team to deliver state of the art Operations Support and Command Assistance Systems to the Polish Police.

OPTIMUS was recently awarded a contract to deliver a system to the Police Department of the city of Lodz, and subcontracted the Computer Aided Dispatch and Mobile Data Communication software components of the Lodz system to DSI. Pursuant to the subcontract, DSI is responsible for delivering an integrated set of software components, specially customized and tailored to the particular requirements of the Polish Police, including complete nationalization and Polish language support, accompanied by the appropriate support services for training, documentation, installation, and maintenance. The value of the intended subcontract is approximately $2.25 million and it is expected to be completed within two years. The parties plan to continue to cooperate on bids for similar contracts in other cities.

"This alliance of OPTIMUS with DSI offers to the Polish Police the combined strength of OPTIMUS, with its proven technology background and local expertise, and the experience of DSI in Mobile Data and Public Safety application software integration and development," said Krzysztof Szczygiel, Project Management Director, OPTIMUS. "We believe these types of strategic agreements offer both organizations a competitive advantage by combining best-of-class software with custom solutions properly localized and adapted to the unique and particular requirements, conditions and environment of the project."

"The relationship with OPTIMUS provides us with a significant opportunity to marry complementary skill sets and immediately offer to our joint customers solutions that fully leverage the power and promise of the most advanced technologies," said Avraham Shimor, Chief Technology Officer, DSI. "DSI is fully committed to the success of our joint customers, and we strongly believe that our cooperation with OPTIMUS will lead to further significant joint business opportunities not only in other Polish cities and Police Departments, but in other European countries, especially in the central and eastern regions of the continent."

This press release contains certain forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to a number of risks and uncertainties which could cause actual results to differ materially from those projected, including risks associated with (i) the fulfillment by DSI of its obligations under the subcontract with OPTIMUS and (ii) the development of additional business in Poland and elsewhere in Europe. A discussion of risks associated with DSSI's business generally is included in DSSI's filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K.

DSI specializes in developing innovative software and hardware for both the commercial and military markets -- with a focus on communication systems for leading companies in Israel and the United States. DSI has completed large-scale projects for the Israeli Navy and Air Force, Israel's PTT BEZEQ, EDS Systemhouse, and New York City Police Department 911 emergency service. Employing a highly professional workforce with a great variety of national language skills in addition to their software and systems engineering qualifications, DSI is uniquely adapted for localization and customization projects. DSI has several technology and business partners both in the US and Europe.

Data Systems & Software Inc. is a provider of computer consulting and development services, and is an authorized direct seller and value added reseller of computer hardware. Through its Comverge Technologies subsidiary, the Company provides data communication solutions to utility customers. In addition, the Company, through Tower Semiconductor Ltd., manufactures integrated circuits on silicon wafers using its advanced production capability and the proprietary designs of its customers.

OPTIMUS S.A. based in Nowy Sacz, Poland is the leading Polish IT company with revenue exceeding $200 million. Founded in 1988, OPTIMUS is traded on the Warsaw Stock Exchange. It specializes in design, development, manufacturing and integration of advanced information technology systems and information technology services. OPTIMUS is present both in commercial and government markets delivering information technology for such distinguished institutions as Ministry of Finance, Polish Post, Ministry of Education, leading banks, etc. Together with its partner, OPTIMUS Lockheed Martin Information Technology Group, a joint venture with Lockheed Martin Corp. (NYSE:LMT) - a leading US company in the area of integrated information solutions, OPTIMUS can offer comprehensive integrated information technology solutions customized to meet customers needs. OPTIMUS is positioned to become one of the largest Advanced Information Systems and Systems Integration Services providers in Central and Eastern Europe.